One in every two new London hotels are budget, report reveals

London Hotel Development Monitor shows low-cost hotels now make up 20 per cent of city's total supply

17/05/2016

Pictured: Nobu Hotel Shoreditch is one budget hotel due to open later this year

London's budget
hotel sector has grown "significantly" since the 2012 Olympics, with the
sector comprising more than half of the 18,000 hotel rooms that have opened in
that time.

In a new report from
property consultant JLL and London & Partners, it has been revealed
low cost hotels now make up 20 per cent of the total supply across the city. A
further 33 per cent of the 7,000 rooms due for completion this year will be in
the same sector.

The report, London
Hotel Development Monitor, also showed new infrastructure improvements and a
booming digital economy had created a 'knowledge corridor' from Bloomsbury to
Paddington, with hotel activity increasing in those areas.

It also reveals
London dominates investment across Europe's hotel sector, with the capital
attracting 36 per cent of total investment.

Graham Craggs, JLL’s hotels and hospitality group MD, said: “2015 was an exceptionally strong year
in terms of hotel transactions in London. Activity will remain high in 2016 and
we expect the trend will shift towards single asset transactions. Underlying
market fundamentals continue to be positive and the outlook for hotel
performance in London is good.”

Key openings include
a new Premier Inn on Tottenham Court Road and US-based hotel operator Standard
opening its first hotel in 2018 in the former Camden Hall. In 2016, 800 rooms
are expected to be added to Shoreditch alone, with new hotels including Z Hotels
and Nobu Hotel Shoreditch.

Gordon Innes, chief
executive of London & Partners, added: “The hotel industry is a vital part
of London’s booming tourism economy, which is now worth £36 billion and
supports hundreds of thousands of jobs, many of which are widely accessible. As
more and more visitors come and explore our great city, it’s encouraging to see
the hotel sector growing and bringing exciting new developments to visitors.”